Stripped-back auto show mirrors German car industry gloom

Major foreign carmakers are staying away with climate demonstrators planning to make up the numbers at this year’s International Auto Show. (AFP)
Updated 08 September 2019

Stripped-back auto show mirrors German car industry gloom

FRANKFURT AM MAIN: Frankfurt’s biennial International Auto Show (IAA) opens its doors to the public Thursday, but major foreign carmakers are staying away while climate demonstrators march outside — forming a microcosm of the industry’s woes.

“There have never been so many cancelations by carmakers,” said Ferdinand Dudenhoeffer of the Center for Automotive Research (CAR).

“The IAA is turning into a trade fair packed with problems,” he added, in the image of the German manufacturers who host it.

Giants like Mercedes-Benz maker Daimler, BMW and Volkswagen are seeing their engineering advantage and profit margins eroded — even as the global economic outlook darkens.

The potential blow of US tariffs on European auto imports hangs over many carmakers, who have already suffered from an escalating Washington-Beijing trade confrontation due to their American factories.

Meanwhile three of the world’s four largest carmakers will stay away from the IAA this year: the French-Japanese Renault-Nissan-Mitsubishi alliance, Japan’s Toyota and US-based General Motors (GM).

Other heavyweights like Italian-American Fiat-Chrysler and France’s PSA have also absented themselves, as well as some of the best-known luxury brands.

The remaining manufacturers huddled in Frankfurt’s massive trade fair complex have one major priority: stoking enthusiasm for new electric models set for release this year, as new EU carbon emissions limits enter into force from 2020.

If manufacturers cannot squeeze the average carbon dioxide (CO2) output of their fleets below 95 grams per kilometer, they will be fined a hefty €95 ($105) per excess gram on each car registered.

After years of delay, German manufacturers still lag foreign competitors like California’s Tesla on the costly research and development for electric alternatives that can score in the mass market.

Even at the high end, Volkswagen subsidiary Audi has failed to dent Tesla with its e-Tron electric SUV.

And stablemate Porsche is betting buyers will be prepared to fork out a massive premium over the Californian brand’s top models for its new battery-powered Taycan.

That makes VW’s Frankfurt launch of its ID.3 — a compact all-electric car that it compares to the legendary Beetle and Golf — of vital importance, as the tip of the spear in the sprawling conglomerate’s €30-billion electric offensive.

The first model based on VW’s modular MEB electric platform, ID.3 “is almost critical to survival” for the company, Stefan Bratzel of the Center of Automotive Management said.

“It has to be a success, the shot has to hit home, because a lot is riding on it.”

Where big international competitors will be lacking, climate demonstrators are planning to make up the numbers at this year’s IAA.

Thousands are expected to hit the streets Saturday, reaching the trade fair on bicycles or on foot, while a blockade is scheduled Sunday amid calls for a “transport revolution.”

After taking on coal mining over the summer, the environmentalists are turning their fire on a sector that long seemed untouchable.

As Germany’s biggest manufacturing industry employing around 800,000 people, the car sector was also protected through deep connections to traditional political parties.

But the winds are changing in German politics.

Climate change has shot up voters’ agenda after a fierce 2018 drought and months of “Fridays for Future” demonstrations by schoolchildren, while the Greens are polling at unprecedented levels and made big gains in this year’s European elections.

Meanwhile a years-long diesel emissions cheating scandal rumbles on, as a case by 400,000 car owners against VW over “dieselgate” opens in three weeks’ time.

And on September 20, all eyes will be on Chancellor Angela Merkel’s beleaguered coalition government in Berlin, as it unveils a comprehensive new climate strategy ahead of a UN summit.


Yemen’s Safer oil company resumes pumping to Arabian Sea terminal

Updated 16 October 2019

Yemen’s Safer oil company resumes pumping to Arabian Sea terminal

  • Yemen’s oil output has collapsed since after the Iran-backed Houthi militia overthrew the internationally recognized government
  • Yemen produced an average of 50,000 bpd of crude in 2018 compared with around 127,000 bpd in 2014

DUBAI: Yemen’s Safer oil company resumed pumping oil from its fields in Shabwa in southern Yemen to a terminal on the Arabian sea for export abroad, a company official told Reuters on Wednesday.
Safer, owned by the internationally recognized government of Yemen, is currently pumping at a rate of 5,000 barrels per day and expects to ramp up pipeline throughput to 15,000 barrels per day, the official said.
Yemen’s oil output has collapsed since after the Iran-backed Houthi militia overthrew the internationally recognized government of Abd-Rabbu Mansour Hadi in Sanaa.
Hadi’s government controls the oil-producing provinces of Shabwa and Hadramout, while the Houthi group controls the capital Sanaa and the oil terminal of Ras Issa on the Red Sea coast.
Yemen produced an average of 50,000 bpd of crude in 2018 compared with around 127,000 bpd in 2014. Last year it exported some quantities of oil.
Safer’s official said the company will use tankers to ship the crude from Iyad field (Block 4) to the Arabian Sea pipeline in Shabwa to avoid the Ras Issa terminal.